India’s latest GDP numbers show the economy growing at 7.8%, but how much confidence should we place in that figure? In this episode of How India’s Economy Works, Puja Mehra speaks with economist Rajeswari Sengupta about the complexities of measuring India’s GDP, the latest base-year revision and the methodological changes behind the new estimates.
Sengupta explains why India’s large informal economy, limited data, rapid structural change and the absence of comprehensive income data make GDP estimation particularly challenging. She also breaks down the shift from single deflation to double deflation, the use of producer price indices, and why the statistical office’s lack of detailed sources-and-methods documentation has raised concerns.
The conversation also examines the use of GST data and surveys of the informal sector, the credibility of the new GDP series, and the unusual spending boom implied by the latest quarterly numbers despite a sharp rise in import prices. Sengupta argues that the debate should be about transparency and statistical methodology—not politics.
Tune in for insights on India’s GDP measurement, the new base-year revision, double deflation, data transparency, and the puzzle surrounding the 7.8% growth figure.
CHAPTERS
(00:00) Introduction to Indian GDP Estimation
(01:19) Challenges in Indian GDP Measurement
(09:47) Uncaptured Services and Gig Economy
(15:19) Controversies of Past Base Revisions
(21:42) Single Versus Double Deflation Explained
(26:04) Shift from WPI to PPI Deflation
(32:43) Missing Methodology and Sources Document
(35:10) Doubts Around Quarterly GDP Numbers
(40:01) Mismatched Identifiers in GST Data
(46:12) Political Pressures on Statistical Agencies
(52:48) The Terms of Trade Shock Puzzle
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